[Edaily Marketin JI YEONG-EUI Reporter] It has been confirmed that 96 employees eligible for performance-based bonuses at the National Pension Service’s Fund Management Headquarters have not received a single won for several months. The delay in bonus payments occurred because the compensation system, which is linked to market performance, was forced to conform to the rigid framework of the government budget. Although this issue could be resolved with the approval of the Ministry of Strategy and Budget, the payment date has been indefinitely postponed due to the fiscal authorities’ bureaucratic delays.

According to data submitted by the National Pension Service to the office of Rep. Lee In-young of the Democratic Party of Korea—a member of the National Assembly’s Health and Welfare Committee—on the 8th, performance bonuses totaling 2.154 billion won for a total of 96 employees—including 75 general staff members at the Fund Management Headquarters, 12 investment staff members, and 9 general staff members at the Compliance Support Office—have not yet been paid. In contrast, the full amount was paid to 411 investment staff members at the Fund Management Headquarters on August 3.

Not only investment staff in the Fund Management Headquarters but also general staff and personnel in the Compliance Support Office are all eligible for performance bonuses. In particular, performance bonuses for general staff have been paid continuously since 2015, following the establishment of regulations after the Board of Audit and Inspection pointed out the issue of non-payment in 2011. According to the enforcement rules of the operational regulations, annual performance bonuses are, in principle, to be paid within one month after the completion of performance evaluations.

Why Is the Ministry of Planning and Budget Blocking Performance Bonuses for National Pension Service Employees?

The cause of this delay lies in a structural mismatch between the performance compensation system and the fund’s budget formulation process. The amount of the

National Pension Service

’s performance bonus is determined only after actual performance results are finalized. In contrast, the fund’s budget—which serves as the source of funding—must be drawn up in advance during the previous year, even before the performance results are known, and reported to the government. Performance bonuses are linked to highly volatile markets, yet the funding for them must be determined in advance according to the government’s outdated framework, which is organized on an annual basis.

Even if a shortfall arises, the National Pension Service lacks the authority to resolve it on its own. Although the fund is composed of subscribers’ premiums and investment returns, expenditures are bound by the fund management plan and must undergo scrutiny and consultation with the financial authorities. This is the underlying reason for the recurring situation where, if returns are low, the allocated budget remains unused, and if returns are high, funds for performance-based bonuses become strained.

In fact, the National Pension Service generated 231.6 trillion won last year with a record-high return on investment of 18.82 percent. With such strong performance—which was impossible to anticipate based on the pre-established budget—the corresponding performance-based bonus requirements inevitably skyrocketed.

This year, although the fund management plan was amended to account for the shortfall in performance-based bonuses, the adjustment applied only to operational staff within the Fund Management Headquarters. The 96 employees in general administrative positions and the Compliance Support Office were excluded without justification, resulting in an indefinite situation of “wage arrears.” This is interpreted as the result of strict budgetary control exercised by the Ministry of Planning and Budget. Given the nature of the Ministry of Planning and Budget, it appears the agency is reluctant to set a precedent of easily adjusting budget plans retroactively.

Market experts point out that the government is turning a blind eye to the reality facing the National Pension Service, which must compete to recruit top talent to ensure the stability of retirement funds. They argue that while the government calls for securing top talent and strengthening fund management capabilities, it is simultaneously exerting bureaucratic pressure on the compensation system—which is crucial for attracting and retaining talent—creating a disconnect.

One capital market expert stated, “Even though the National Pension Service is a public institution, it must at least guarantee a level of compensation predictability on par with the private sector to retain top investment talent.” He added, “With compensation levels already lower than in the private sector, if delays in paying out already-approved performance bonuses continue to occur, staff turnover is as certain as day follows night. Excessive budgetary control by the fiscal authorities is effectively eroding the National Pension Service’s organizational competitiveness.”